How to resolve ugly artifacts bending joints after posing?
Typically its best to first attempt to resolve the issue by weight painting.

That is to adjust the weights around the joint to improve the deformation. 


Adjust weight values by manually painting.
Use the smooth tool to automatically re-distribute weights (new in 2.76), eg: 
Try the 'dual quaternion' option in the armature modifier(helps avoid volume loss),
When weight painting can't quite resolve all artifacts,try the  corrective smooth modifier (new in 2.75)
Corrective shape keysUsing a shape key to manually correct the distortion. While its involved to setup, it can be driven by bone and gives most control, This is typically used for more advanced rigging.